Los Angeles City Employees' Retirement System will search for an active domestic small-cap value equity manager, an emerging fund-of-funds manager and two active domestic large-cap equity managers, according to a source at the $8.4 billion fund, who declined to be identified. Fund officials have not decided when to conduct the searches.
The small-cap value manager will run about $175 million. The emerging fund-of-funds manager, which will focus on active domestic equities, will manage a portfolio tentatively targeted around $75 million. The large-cap managers will run around $225 million each. The new allocation represents a shift from passive to active as the system searches for sources of additional alpha. Passive strategies account for about $2.3 billion of the fund's $4 billion in domestic equity assets. Funding for the four managers will come from cash.
Separately, the board hired Ennis Knupp to provide strategic planning services. The incumbent was Mercer Investment Consulting. The board made the switch because it had a relationship with Nancy Williams, who left Mercer to join Ennis Knupp last year.
The board also renewed the contract of RhumbLine Advisers, which manages a $500 million S&P 500 index fund for the system. An RFI had been issued in January because RhumbLine's three-year contract was up.